Don’t be like Arizona

I don’t have a whole lot of hope for the 2011 legislative session and the budget that it will produce. But at least we won’t do anything quite this stupid.

Arizona on Thursday became the first state to eliminate its Children’s Health Insurance Program when Gov. Jan Brewer signed an austere budget that will leave nearly 47,000 low-income children without coverage.

The Arizona budget is a vivid reflection of how the fiscal crisis afflicting state governments is cutting deeply into health care. The state also will roll back Medicaid coverage for childless adults in a move that is expected to eventually drop 310,000 people from the rolls.

State leaders said they were left with few choices because of a $2.6 billion projected shortfall next year. But hospital officials and advocates for low-income people said they were worried that emergency rooms would be overrun by patients who had few other options for care, and that children might suffer enduring developmental problems because of inadequate medical attention.

The cuts also mean the state will forgo hundreds of millions of dollars in federal matching aid, and could lose far more if Congress passes a health bill that requires states to maintain eligibility levels for the two programs.

It’s hard to imagine a policy that’s more penny-wise and pound-foolish than that. In addition to all of the lost matching funds, you’re ensuring that thousands of families will use the least efficient and most expensive form of health care there is – emergency rooms, which by the way pushes a whole bunch of cost onto local governments – and thousands of children will be less healthy. That will lead to poorer educational outcomes and to such longer term consequences as reduced earning potential and higher rates of crime. You really couldn’t do worse if you tried.

The good news is that the just-passed health care bill includes a provision that prohibits states from dropping CHIP. I didn’t think that would have been an option here anyway – it’s a bridge too far, even for us – but now any temptation to go for it is gone. Doesn’t mean we won’t have some CHIP cuts, but at least there will be a limit. Link via Yglesias.